Oil on track for weekly losses on global economy concerns

Oil prices reversed higher in American trade on Friday after a drop in Europe, amid attempts to climb off week lows after a steep decline in Saudi production, but prices still headed for weekly losses on prospects of global economic slowdown. 

As of 13:59 GMT, US crude rose to $52.80 a barrel, while Brent rose to $62.20 a barrel. 

US crude lost 2.4% on Thursday, marking week lows at $51.78, while Brent sipped 1.5%, the third loss in four days. 

OPEC reported a decline of 400 thousand bpd in Saudi production in January to a total of 10.24 million bpd, the lowest since early 2018. 

Oil prices are down 4% so far this week on track for the second weekly loss in three and under pressure from the slower global growth forecasts. 

European Growth 

The European Commission slashed estimates for growth this and and next due to internal challenges and global trade tensions. 

The euro zone's growth this year is estimated to slow down to 1.3% from 1.9% in 2018, before inching up to 1.6% in 2020. 

Bank of England Governor Mark Carney warned that a no-deal Brexit would raise economic recession risks, adding that resulting uncertainty would harm trade and finances considerably. 

The BoE cut growth estimates for the UK to 1.2% from 1.7% previously. 

Global Growth 

The International Monetary Fund cut estimates for global growth on rising risks and weakness in Europe and some developing economies. 

The IMF expected 3.5% in 2019, down from 3.7% in previous forecasts, and 3.6% in 2020, down from 3.7%. 

US Oil Rigs 

Baker Hughes, a US oil services company, reported a drop of 15 rigs in the oil rig count to a total of 847, after data showed US production steadied at record highs at 11.9 million bpd. 

Last month, the Energy Information Administration forecast an increase in shale oil output to another record 8.179 million bpd, however the drop in rig activities might taper these expectations.